Compounded drugs are a new hot issue in the pharmaceuticals industry and in Congress. There are little data about compounding pharmacies, but a new Congressional Research Service brief gives a comprehensive overview.

Compounded Drugs Personalize Drug Treatments:

Compounded drugs are created when a physician or pharmacist mixes or changes pharmaceuticals to meet an individual patient’s needs. For example, a patient who has trouble swallowing might need a liquid version of a prescription drug that comes in tablet form. Other patients are allergic to certain ingredients and or need uncommon dose sizes.

Since pharmacists are responsible for those traditional forms of compounding, state pharmacy laws are the major form of regulation for compounded drugs. There is limited federal authority over the industry, and there are few records of how big the compounded drug (CD) market is, which drugs are compounded, or how and why they are compounded.

Though compounded drugs might seem to be an obscure topic, several recent recalls from large-scale drug compounding firms has drawn Congress’s attention to the subject. A recent brief from the Congressional Research Service (CRS) gives an excellent run-down of the status of traditional and new drug compounding practices, recent public health issues related to CDs, and possible Congressional actions to change the federal government’s policy on compounded drugs.

This blog post will give a quick overview. You can read the full CRS brief here.

CD Industry Growth:

What little information exists suggests the compounded drug industry has grown recently. Large-scale producers – far different from the individual pharmacies and physicians traditionally associated with CDs – now make compounded drugs for thousands of customers. PharMedium and New England Compounding Center are two large compounding pharmacies that together serve more than 20,000 hospitals, physicians offices, and other provider clinics.

The CRS brief gives four reasons for growth in CD production:

1. An increase outsourcing of CDs from hospitals.

Hospitals traditionally have compounded drugs for specific patients. Yet some large hospital systems have begun to mass-produce CDs, in amounts beyond what they need. For example, the Cleveland Clinic Health System reported producing 870,000 doses of compound drugs, 56 percent of which were for specific patients and the rest of which were for anticipated future needs.

2. Drug shortages, unavailability, and discontinuation of FDA-approved drugs.

One of the reasons large hospitals might mass-produce or purchase CDs is to fill a need for drugs that are otherwise unavailable because of drug production shortages. A 2013 report from the U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG) found that 68 percent of hospitals surveyed said they purchased CDs because of drug shortages.

3. Physician and consumer interest in individualized products.

Physicians, too, might be interested in CDs because of drug shortages. But CDs also give physicians greater flexibility to prescribe off-label drugs that are cheaper or that better serve patient health.

4. Increased interest by pharmacists in new markets.

The CRS brief describes compounded drugs as a growth business for pharmacies, particularly those looking for a way to compete against large chain retail pharmacies. Compounding also gives pharmacists greater involvement in patient care, an evolution of the pharmacy business model from distribution to individualized services.

Health Risks, Recalls of Compounded Drugs:

Compounded drugs have the potential to increase risks to public health and patient safety, particularly as demand picks up for CDs to mitigate drug shortages. Three quarters of drugs shortages are for sterile injectable generic drugs, which can be the most difficult types of drugs to compound safely. Compounding sterile drugs, or drugs with sterile and non-sterile ingredients, requires special training and facilities, and there are significant risks to drug safety when sterile drugs are compounded in non-sterile environments. Recalls of potentially unsafe CDs can exacerbate shortage problems.

There have been several high-profile drug recalls related to compounded drugs in the past two years. Among them:

The CRS brief compiles reports of CD recalls, but there is no federal requirement to report adverse events that stem from compounded drugs.

“The vast majority of these adverse events involve sterile compounded products. Sterile compounded products include injectable drugs, IV-delivered drugs and solutions, inhalation drugs, and parenteral nutrition that are administered directly into the body and must be sterile to assure patient safety,” CRS brief.

Congress Considering Bills to Increase Regulation:

The 113th Congress is considering two bills that would address various aspects of federal compound drug oversight.

S. 959, sponsored by Sen. Tom Harkin, would allow for adverse event reporting, institute registration of compounders, create manufacturing standards for sterile CDs shipped across state lines, and would expand FDA regulation of compound drug manufacturers. The bill is ordered to be reported from the Senate Committee on Health, Education, Labor and Pensions (HELP).

H. 2186, sponsored by Rep. Ed Markey, would take similar measures.

Additional Resources:

The CRS and Congress have produced several more informative reports about other aspects of the drug compounding industry. Check out additional resources here:

Compounding Pharmacies,” Office of Congressman Ed Markey

Examining Drug Compounding,” House Committee on Energy and Commerce

FDA’s Authority to Regulate Drug Compounding,” CRS report

FDA Guidance on Pharmacy Compounding